A recent study found that 186,000 jobs could be lost in the European automotive industry over the next decade.
If Donald Trump follow through with his promise on tariffs during the electoral campaign, EU economic growth could be seriously undermined.
The president-elect repeatedly stated his intention to impose a 10% tariff on European products.
One of the worst hit sectors would be the automotive industry, in particular that of Germany.
The Association of the German Automotive Industry (VDA) says everything must be done to ensure that new US tariffs are not imposed. The association’s spokesperson, Simon Schuetz, told Euronews:
“I think that both sides need to talk to prevent this. If it does, we both know what will happen next. And the European Union will probably have some measures in response, and that would be the start of another trade conflict or something of that kind. And that’s not what we need. Europe and the US need to understand that, looking at all the geopolitical challenges, we need to work together, and that politics and economics needs to be considered together.”
The situation for the automotive industry in Germany is already difficult, with Volkswagen recently announcing the closure of three plants. A recent study found that 186,000 jobs could be lost over the next decade, as the industry switches to EV production.
The unsolved issue of steel and aluminium
The other most affected sector would be the steel industry. The US and Europe still have not fully resolved the issue of tariffs imposed by the previous Trump administration – which have already caused a noticeable slump in exports.
According to the European Steel Association (EUROFER), further lengthy and complex negotiations lie ahead.
Axel Egger, its Director General, told Euronews:
“A way forward had been agreed upon between Joe Biden and the European Commission under Ursula von der Leyen to address the trade conflict concerning steel, as well as a global arrangement on sustainable steel and aluminum. The negotiations have stalled since the election campaigns in the US began, however. Our hope is that negotiations can continue after the elections in order to find a solution, because otherwise we will fall back into an era of tough 25% tariffs on European steel”.
The Association also underlines the need for the new US president to be persuaded with regards to climate goals, not least with regards to his country’s own industry, as steel and aluminium manufacturing are one of the biggest carbon-emitters.